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Disappointments Overshadow a Few Victories in Health Care and Labor Relations

By Mike Ripley, vice president of health care policy and employment law

Simply put, it was one of the Chamber’s biggest disappointments of the session: The General Assembly failing to implement reforms to reduce smoking in Indiana. We knew the landscape going in but felt something positive could occur. Since 2018 was a non-budget year, that meant no one realistically expected an increase in the cigarette tax. However, there was hope for the potential of raising the smoking age to 21 and a repeal of the protective class for smokers, which prohibits employers from asking potential hires about the habit.

The Alliance for a Healthier Indiana, of which the Indiana Chamber is a charter member, is committed to seeing improvements in the state’s overall health and smoking rankings (currently at 35th and 36th respectively). There were two bills that carried efforts to make that happen.

House Bill 1380, authored by Rep Charlie Brown (D-Gary), would have raised the legal age for smoking and purchasing cigarettes from 18 to 21. The Chamber and the Indiana Hospital Association, along with a host of others, championed the measure in the House Public Health Committee, where it passed unanimously. In the bill’s fiscal impact, the Legislative Services Agency had not attributed a revenue loss to the increase in age.

But House Republican’s estimated the revenue loss at $14 million and sent the bill to the Ways and Means Committee, thus killing the bill for this session since it was impossible to pass the measure by committee deadline (that same day). This concern was not presented to proponents prior to this action being taken and it was apparent that the House Republican caucus simply did not want to vote on the bill this year.

This effort was Rep. Brown’s swan song on this issue; he is retiring, and we thank him for his leadership.

In the Senate, Sen. Liz Brown (R-Fort Wayne) authored SB 23, the repeal of the protections for smokers. Senator Phil Boots (R-Crawfordsville), chairman of the Pensions and Labor Committee, informed the Chamber that he wanted his committee members to tell him they wanted the bill to be heard. Only six of the 12 committee members could be swayed to support the bill – Sen. Boots, by the way, was a no, and the bill did not receive a hearing. We subsequently learned Sen. Boots never had any intention of hearing the bill.

Indiana takes pride in having a strong business climate. However, the health of Hoosiers is holding the state back from achieving even more, and this is largely due to the state’s high smoking rate (and other unhealthy behaviors). What’s more, smokers cost Hoosier employers over $6 billion per year in additional health care costs, absenteeism and lost productivity. The true victims, of course, are the individuals who suffer the health consequences due to their smoking addiction. For all these reasons, the Chamber and the Alliance for a Healthier Indiana will keep up the fight on this front in the 2019 session.

Health care and labor relations intersected on several important pieces of legislation.

In response to concerns from the Chamber’s manufacturing members, asbestos litigation was one of the organization’s top priorities for the 2018 session. As introduced, House Bill 1061, authored by Rep. Matt Lehman (R-Berne), would have fixed the statute of repose for product liability for asbestos, which the Indiana Supreme Court found to be unconstitutional in March 2016.

It also would have brought transparency to the process of when an individual files a claim with a trust and also brings suit in an Indiana court. Specifically, an individual would have to disclose to a jury what trusts they have made a claim to and what trusts they believe they are entitled to; this would allow a jury to have all the information to make a more informed decision.

To pass the House Judiciary Committee, the bill had to be amended to a study committee for the statute of repose section, with the rest of the bill remaining intact. Subsequently, the bill passed the House and got stalled in the Senate. The Senate Civil Law Committee is simply stacked against the business community on tort issues due to the makeup of the committee favoring trial attorneys.

Chairman Randy Head (R-Logansport) did allow testimony on the bill, but the votes weren’t there to pass it out of committee. Attempts were made to change the bill for some compromise but were unsuccessful. There is a slight possibility of having the issue studied this summer. The Chamber will be providing input wherever possible.

In the plus column, successes were realized on the opioid front.

Senator Head authored SB 369, Worker’s Compensation Drug Formulary, which requires (in worker’s comp cases) the use of prescription drugs listed on a specified drug formulary (i.e., physicians are only allowed to prescribe the drugs on the formulary). There is a process if they elect to use drugs not on the formulary. Creating drug formularies is a fairly recent trend among states. Texas has seen a reduction in prescriptions costs for worker’s comp and a reduction in the number of opioids being prescribed in those cases. The belief is that Indiana will see the same welcome trend.

The Chamber, along with the Indiana Manufacturers Association (IMA), pushed hard for this legislation even at the opposition of the Worker’s Compensation Board – which ultimately stood down. The Governor signed the bill, but there is potential controversy. The bill specifies a certain drug formulary to be used and a competing formulary vendor in opposition to the bill has raised the question of constitutionality. At Sen. Head’s request, the Chamber, IMA and Insurance Institute of Indiana submitted a letter of support for the language in the new law.

Senator Head also authored SB 225 (Continuing Education Requirements) that requires licensed health care practitioners who apply for a controlled substances registration or reregistration to complete two hours of continuing education on the topic of opioid prescribing and opioid abuse. The Chamber supported this needed bill to address the supply side of the opioid problem.

The other drug-related legislation that passed this year came from Rep. Steve Davisson (R-Salem). Undeterred when his recovery and treatment bill died in the House Ways and Means Committee, he resurrected the issue without a fiscal impact component in House Bill 1007, where it was labelled the Employee Substance Abuse Treatment Program. It requires the Division of Mental Health and Addiction to establish best practice guidelines to assist employers with employees who agree to participate in a drug education and addiction treatment program after failing a drug test.

Informational resources and training for employers on substance abuse will also be provided. In addition, an employer would not be liable in a civil action alleging negligent hiring of that employee. The Chamber lobbied extensively in favor of this program, which provides employers the chance to assist employees in addressing their drug problem and keeping them in the workforce. This new law dovetails nicely with the Chamber’s recently announced effort to – along with its affiliate, the Wellness Council of Indiana – join forces with Governor Holcomb and his administration to combat the opioid epidemic. The Indiana Workforce Recovery initiative will focus on education and guiding employers through the steps they can take to help.

Two Wins and One Continued Source of Frustration

House Bill 1035 contains minor changes to unemployment insurance (UI). Authored by Rep. Dan Leonard (R-Huntington), the measure allows the Department of Workforce Development (DWD) to review appeals on decisions in which an individual has contested income withholding or wage garnishment for overpayment of benefits. Currently, an employer may impose a collection fee for income withholding to repay UI benefit overpayments at $12 or 3% of withholding. That will now change to a flat $12, which is preferable. Additionally, the legislation codifies policy already being executed by DWD regarding worker’s compensation being excluded as a wage for UI purposes.

Late in the session, Rep. Ed Clere (R-New Albany) alerted the Chamber to a DACA (Deferred Action for Childhood Arrivals) issue that we initially took a neutral position on. We then discovered the problem: It was possible for an individual to be legally entitled or authorized to work in Indiana after having provided documents of identification and authorization under the I-9 process for employment, yet not be entitled to obtain or re-obtain a professional license required for their specific field because of an existing statute that required an individual to either be a U.S. citizen or qualified alien (2011 law change).

There was an example of a nurse who was working but was unable to renew her professional license because of the Professional Licensing Agency’s interpretation of the statute. Although the situation was labeled as a problem for DACAs, we believe that the issue had the potential for a larger impact. Thus, the Chamber testified in favor of the fix in SB 419. We want to thank Chamber Labor Policy Committee Chair Dave Swider and committee member Chris Schrader for their vital input on this discussion.

That leaves us with this year’s work share bill, HB 1109, authored by Rep. Health VanNatter (R-Kokomo), who is the chairman of the House Labor and Pensions Committee. The Chamber lobbied him, DWD and the Governor’s office on the importance of the issue. The DWD had a change-over in staff and there was originally some hope that might lead to a change in philosophy – either view work share in a favorable light or at worst remain neutral. That hope was short-lived.

In late January, Rep. VanNatter was given an opposition piece from DWD detailing what was wrong with the issue. It was all the same things we’ve heard and addressed before, including with a study last year. The Governor’s office never really weighed in on the issue, while the IMA remained steadfast in opposition – despite members of theirs being in favor of the policy. In the end, Rep. VanNatter decided that without support from the Governor or DWD, he shouldn’t hear the bill. Efforts are already underway to further educate on this important policy, which will benefit companies and their employees in the eventual economic downturn.